The American Housing Market is Set to Screw People Far into the Future

Our political vocabulary is changing all the time. Words that loom large in one generation’s national public discourse can almost totally disappear in the next.

Take the word “segregation.” A half-century ago, newspapers headlined “segregation” on almost a daily basis. This same word today seldom ever appears, either in print or on our computer screens. To our contemporary sensibilities, segregation seems so, well, yesterday.

But segregation still stains America, and not just the lingering legacy of the racial segregation that Americans battled decades ago. America now faces a stark income segregation as well — and this income segregation is getting worse.

Last week, researchers from the U.S. Census Bureau released a new report that details one aspect of this new segregation: the concentration of high-income households by metro area.

How concentrated have these high-income households become? The new Census study, thefirst ever to examine where America’s most affluent 5 percent live, offers a rather dramatic picture.

In some U.S. metro areas, the new data show, you can knock randomly on 100 doors and expect to find only one household making at least $191,469, the income threshold for entering America’s top 5 percent between 2006 and 2011.

In other metro areas, that same door knocking would turn up as many as 18 households making near $200,000 and above.

Affluence in America today almost totally bypasses broad swatches of the nation.

In effect, affluence in America today almost totally bypasses broad swatches of the nation, from Cumberland in Maryland to the Kingman area in Arizona. Affluence is settling instead in a relatively few pockets, places like Silicon Valley in California and the hedge-fund-happy suburbs around Stamford, Connecticut.

Our contemporary income segregation becomes even more intense when we drill down from the metro to neighborhood level. Sociologists Sean Reardon and Kendra Bischoff have been doing this drilling, using Census tract data.

Back in 1970, the pair have found, 65 percent of America’s families lived in “middle-income” situations, neighborhoods where incomes range from 80 to 125 percent of the median, or most typical, income of the larger metro area. By 2008, only 43 percent of U.S. families lived in middle-income neighborhoods.

Meanwhile, over that same span, the share of families living in either poor or rich neighborhoods essentially doubled.

In 2008, note Reardon and Bischoff, nearly one in three U.S. families in metro areas “lived in neighborhoods at the extremes of the local income spectrum,” in poor neighborhoods with incomes under 67 percent of the metro median or in affluent neighborhoods with incomes above 150 percent of that median.

Today’s affluent, Reardon and Bischoff observe, actually live more segregated lives than America’s poor. These affluent have become “much less likely” to live in mixed-income neighborhoods than poor families.

Growing income inequality, the two sociologists add, is driving this increasing segregation. With the income gap between the rich and everyone else rising, mixed-income neighborhoods “have grown rarer,” affluent and poor neighborhoods “much more common.”

Average Americans, for their part, are paying a heavy price for this growing segregation. The more isolated the rich become, the more they withdraw into their own private worlds and the less interest they have in supporting public services that can benefit the wider community.

Growing inequality and income segregation impact us on a deeper level as well. The more unequal we become, notes University of Maryland political scientist Eric Uslaner, the less we feel we have “much in common” with people not like us.

Between 1968 and 2006, Uslaner’s research documents, the share of Americans who believe that “most people can be trusted” dropped from 56 to 34 percent. “Such overarching pessimism,” he observes, shreds social cohesion and invites political polarization. Finding “common ground” becomes ever more difficult.

Into this doom and gloom, Stanford historian Richard White has just brought some egalitarian sunshine. Once upon a time, White writes in a fascinating new Boston Review essay, most Americans lived in much more equal circumstances.

In the 1860 Illinois of Abraham Lincoln, for instance, Springfield “bricklayers, lawyers, stable owners, and managers lived in the same areas and were not much separated by wealth.”

Back then, White explains, “making it” meant earning an income able “to support a family and have enough in reserve to sustain it through hard times at an accustomed level of prosperity.”